"We don't want the next Intel or Google to be created in China or India. We want those companies and jobs to take root in America," Obama said, as he made a case for bringing 11 million illegal immigrants out of the shadows and putting them on a path to citizenship.
Arguing that immigration was fundamental to his country's economic wellbeing, he said that the US could not afford to train future entrepreneurs at US colleges, then send them home to compete with American firms.
"Look at Intel and Google and Yahoo and eBay -- these are great American companies that have created countless jobs and helped us lead the world in high-tech industries. Every one was founded by an immigrant."
Obama said Republicans would seek to block his drive for immigration reform, in an apparent play for vital Hispanic votes in his 2012 reelection bid.
In a major speech on the US-Mexico border, he mocked the Republican position on immigration, accusing party leaders of stepping away from the table to appease their conservative political base. His comments are likely to draw ire from his opponents.
"We have gone above and beyond what was requested by the very Republicans who said they supported broader reform as long as we got serious about enforcement," Obama said, at the southern US border in El Paso, Texas.
"Even though we've answered these concerns, I have got to say I suspect there are still going to be some who are trying to move the goalposts on us one more time," Obama said.
"They'll say we need to triple the border patrol. Now they will say we will need to quadruple the border patrol. Or they will want a higher fence," he added.
"Maybe they'll need a moat. Maybe they will want alligators in the moat -- they'll never be satisfied, and I understand that. That's politics."
Obama's comments represented a new attempt to tackle an issue that has confounded US leaders for years, the last attempt at comprehensive immigration reform foundered in former president George W Bush's second term.